Anglian in row over water competition

A row over competition in the water supply market flared yesterday when one of the companies trying to break into the market, Aquavitae, said it had complained to the Office of Fair Trading about the price Anglian Water wants to charge for access to its supply network.

Aquavitae claims that Anglian's prices would squeeze its margins and make it impossible for Aquavitae to make a profit. Michael Samorzewski, Aquavitae's managing director, said: "Anglian allowed us such a small discount that if we won the business of three of its big customers, using water valued at about £1m per year, our margin would be only £1,500 a year." Anglian Water said it was disappointed by Aquavitae's action. A spokesman said Anglian had been working with Aquavitae since before the market was opened up and had reached a master agreement with Aquavitae last year, ahead of other water companies. "We are in the forefront of helping competition here," the Anglian spokesman said.

The water and sewerage industry in England and Wales was privatised in 1989 into what amounted to a series of regional monopolies. In 2003 legislation sought to open the market by allowing customers using more than 50 million litres a year to choose to switch suppliers. A number of companies, including Aquavitae, have been granted licences to supply water but no customers have yet switched.